09/15/2010

Theory Co-Founder Jumps Ship to Join SAC

 

With his firm in wind-down mode, Theory Capital co-founder Carl Fantasia has lined up a new job as a portfolio manager at SAC Capital.

The move comes just three weeks after Fantasia and his partner, Robert Broggi, e-mailed investors with news that they're shutting down their Boston firm a little more than a year after it opened. The Tudor Investment alumni launched a technologfy, media and telecommunications stock fund with backing from Jim Pallotta, who once headed Tudor's equity business. But despite their pedigrees, Broggi and Fantasia never got much traction with investors.

Fantasia is expected to start Oct. 1 in the Boston office of SAC, which is headquartered in Stamford, Conn. Word has it that Steve Cohen's $13 billion firm has promised Fantasia an analyst and about $300 million of capital to work with. It's unclear what Broggi plans to do next.

Broggi and Fantasia worked together for about five years at Tudor, where they ran a book of technology, media and telecommunications stocks within Pallotta's Raptor Capital unit. During the financial crisis, Pallotta spun off Raptor as a separate business in Boston, but shuttered the firm last year.

After setting up Theory Capital in June 2009, Broggi and Fantasia launched their hedge fund in November with an undisclosed amount of seed capital from Pallotta. Despite his imprimatur - and promising early returns - Theory fell far short of its fund-raising goal.

The firm never reached the $20 million mark, and Broggi and Fantasia realized it would take too long to achieve their unofficial goal of $100 million under management by the end of 2011. Although they had enough personal capital to cover the firm's expenses for five years, the partners put out an e-mail on Aug. 25 telling investors they were unwinding their fund.

Why the weak response from investors? Some prospective investors said the market opportunities that allowed the duo to post strong returns at Raptor had long since dried up.

Broggi spent seven years at Tudor and then Raptor, where he was a senior tech analyst and technology, media and telecommunications sector head for the Raptor Funds. Fantasia clocked five years at Tudor and Raptor as a senior media and Internet analyst.

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